Gems and Jewellery export figures plummeted in the month of May by 12.85% to $3.17 billion from $3.64 billion last year. Combined exports in April and May took a 9.11 per cent dip to $6.07 billion according to the data provided by the Gems and Jewellery Export Promotion Council (GJEPC). Cut and polished diamond exports in May fell 15.12 per cent to $1.88 billion, while the value of gold jewellery shipments fell 14.27 per cent to $1.03 billiion. This is one of the sharpest falls, and it comes at a time when the industry was hoping for some recovery and a softer approach towards funding on the part of banks.

Elaborating the reasons for the fall, Colin Shah, Vice Chairman, GJEPC said, “Apart from high customs duty on polished diamonds, gold, and issues of ease of doing business in special economic zones, there were two other factors that led to the fall -- customs issues in Bharat Diamond Bourse and global economic uncertainty following the US-China trade war. The finance crunch in the Indian jewellery sector only made matters worse.”

The Customs Department had issued a circular demanding very fine details on import of rough diamonds, due to which consignments were seized by the authorities. Left with no other options, Importers have now reluctantly started clearing these stocks after providing the required details. Exporters were hoping for a relaxation in banks’ approach towards the industry in FY20, but that hope has been distinguished. Banks had tightened all financing to gem and jewellery sector a year ago, post the Nirav Modi-Gitanjali scam. GJEPC predicts that these factors will keep exports under pressure in near future.